Yield-starved investors seek dividend income as share rally falters

martes 20 de mayo de 2014 05:46 GYT

* Dividend investing back in fashion as rally falters

* Low bond yields limit alternatives to equities

* Vodafone, Apple, BHP Billiton screen as reliable payers

By Francesco Canepa

LONDON, May 20 (Reuters) - Global investors are hunting for reliable dividend payouts as they grapple with jittery equity markets and meagre bond yields, marking the revival of an investment style that has been shunned for the past two years.

Dividend investing is back in vogue as lofty equity valuations, amid still sluggish economic growth, cap the potential for further share price gains while low bond yields limit the attraction of fixed-income assets.

Having lagged a market rally over the past two years, the MSCI World High Dividend Yield Index has outperformed this year as more cyclical sectors, such as Internet companies and small caps, falter and yields on lower-rated bonds remain depressed.

"People have become more risk averse and that is a big element of the dividend story," said Andrew Parry, chief executive officer of Hermes Sourcecap, which manages assets worth 2.4 billion euros ($3.29 billion).

"And with bond yields so utterly low ... you buy equities to bolster your returns."   Continuación...